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Montana Tax Credit Details
Effective for gifts made through December 31, 2013 |
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| Gifts from Individuals: |
| Planned Gift: an irrevocable contribution to a permanent endowment held by a tax exempt organization when the contribution uses any of the following techniques that are authorized under the Internal Revenue Code: |
(a) |
charitable remainder trusts |
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- The trust may not terminate and the beneficiaries' interest in the trust may not be assigned or contributed to the qualifying endowment sooner than the earlier of: the date of death of the income beneficiaries; or 5 years from the date of the contribution.
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(b) |
pooled income fund trusts (not available from the MSU Foundation) |
(c) |
charitable lead trusts |
(d) |
charitable gift annuity |
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- The annuitant or annuitants may not assign their interest to a qualified endowment sooner than the earlier of the date of death of the annuitant or annuitants; or 5 years after the date of the contribution
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(e) |
deferred charitable gift annuity |
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- The payment of the annuity must begin within the life expectancy of the annuitant or joint life expectancies of the annuitants, if a two life annuity, using the actuarial tables in effect on the date of the contribution; and
- The annuitant or annuitants may not assign their interest to a qualified endowment sooner than the earlier of the date of death of the annuitant or annuitants or 5 years after the date of the contribution.
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(f) |
charitable life estate agreement |
(g) |
paid up life insurance policy |
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| A taxpayer (individual or sole proprietor) is allowed a credit against taxes imposed in an amount equal to 40% of the present value (charitable gift value) of the aggregate amount of the charitable gift portion of planned gift made by the taxpayer during the year to any qualified endowment. The maximum credit that may be claimed by a taxpayer for contribution made from all sources in a year is $10,000 and may not exceed the taxpayer's income tax liability. The credit may not be claimed if the taxpayer has included the full amount of the contribution upon which the credit was computed as an itemized deduction. The may be applied only to the tax year in which the gift is made. |
| Corporations: A corporation is allowed a credit in an amount equal to 20% of a charitable gift against Montana taxes otherwise due for charitable contributions made to a qualified endowment. The maximum credit that may be claimed by a corporation for contributions made from all sources in a year is $10,000 and may not exceed the corporation's income tax liability. It may not be claimed if the corporation has included the full amount of the contribution as a deduction. There is no carryback or carryforward provision and the credit must be applied to the tax year in which the contribution is made. |
| Small Business (S) Corporation, Partnership, and Limited Liability Company — A contribution to a qualified endowment by a small business corporation, partnership, or limited liability company carrying on any trade or business for which deductions would be allowed under section 162 of the Internal Revenue Code, 26 USC 162, or carrying on any rental activity qualifies for a credit in an amount equal to 20% of charitable gift against Montana taxes otherwise due for charitable contributions made to qualified endowment. The credit must be attributed to the shareholders, partners, members, or managers of a limited liability company in the same proportion used to report the corporation's, partnership's, or limited liability company's income or loss for Montana income tax purposes. The maximum credit that a shareholder of a small business corporation, a partner of a partnership or a member of manager of a limited liability company may claim in a year for contributions made from all sources is $10,000 and may not exceed the shareholder's, partner's, or member/manager's tax liability. It may not be claimed if the shareholder, partner, member/manager has included the full amount of the contribution as a deduction. There is no carryback or carryforward provision and the credit must be applied to the tax year in which the contribution is made. |
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For more information about designating your gift to MSU contact Alberta Rivera at (406) 994-2053 or email: arivera@montana.edu |
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